SINGAPORE, 3 MARCH 2009 - Software vendors, rejoice. Organisations in the Asia Pacific are expected to buy more enterprise applications in the next few years, said Springboard Research.

In its report, Different Hues of Growth: Enterprise Software Market and Forecast 2007-2012, estimates that the software market in Asia Pacific excluding Japan (APEJ) could grow from US$18.2 billion in 2008 to US$30 billion in 2012, representing a compound annual growth rate (CAGR) of 13.1 per cent.

The report lists China and Australia as the largest software markets in the region, with China the fastest growing at a CAGR of 17.7 per cent, nearly double of Australia's rate of 9.1 per cent. India has been tipped to surpass South Korea by 2011 to become the third largest enterprise software market, ultimately representing 15.6 per cent of region's market spending by 2012.

SaaS [software-as-a-service] and cloud computing, virtualisation, collaboration, and open-source software are among the enterprise software markets that will see strong demand throughout 2009, said Michael Barnes, vice president of software research at Springboard.

Spending in a financial crisis

The report pointed out that because of the ongoing financial crisis, there would be a slowdown in infrastructure' projects involving large middleware licence sales over the next two to three years. However, a dramatic drop in IT spending is not expected, particularly ongoing enterprise software-related spending linked to multi-year transformational projects.

Enterprise-wide SOA [service-oriented architecture] initiatives that are not directly linked to well-defined, measurable business imperatives will be far tougher to justify in the current economic climate, said Barnes.

In contrast, Barnes expects platforms in the areas of supply chain management, business intelligence and enterprise content management to have continued strong demand. Web conferencing and other collaboration tools will also see healthy growth as companies reduce spending on travel, he added.